829. The requirement to
declare relevant interests applies not only to proceedings in
the House but also to transactions or communications with other
Members, and with Ministers or servants of the Crown. The requirement
is more onerous than for registration in that it relates to "any
relevant pecuniary interest or benefit of whatever nature, whether
direct or indirect, that [a Member] may have had, may have,
or may be expecting to have."
830. It is clear from the
relevant departmental papers that this requirement was breached
by Members involved in the House of Fraser lobbying group; and
by those lobbying in relation to Skoal Bandits.
831. In the case of the
House of Fraser lobbying group, there is some evidence that Sir
Peter Hordern declared his House of Fraser consultancy at
least once in communicating with Ministers; and it is probably
true to say that they were aware of this association. By the standards
applying at the time this may well have been regarded as sufficient
to meet the requirement to declare his interests, though it clearly
fell well short of the terms of the Resolution of 1974.
832. Mr Smith acknowledges
that, in his dealings with Ministers and officials, he should
have declared his interest and regrets not having done so. He
accepts that a possible reason for this was that his representations
would carry more weight coming from an officer of the Conservative
Party Trade and Industry Committee than from a paid lobbyist.
Notwithstanding his denials, it seems to me that his interest
was so obvious that his failure to disclose it when making representations
must have been deliberate.
833. Mr Hamilton
also referred, when making representations to Ministers and others,
to his position as Vice-Chairman of this Committee rather than
to any pecuniary interest or benefit he was receiving from Mr
Greer - Mr Al Fayed's paid lobbyist. Even if he had not been
in receipt of any cash payments from Mr Al Fayed or from Mr Greer,
he enjoyed at various stages hospitality and other registrable
benefits provided by the former. In my judgment the existence
of those rewards should have been disclosed. The receipt of cash
payments, directly or indirectly, from Mr Al Fayed puts Mr
Hamilton in exactly the same position as Mr Smith and
renders him equally culpable in not registering or declaring his
834. Sir Andrew Bowden
and Sir Michael Grylls both claim that declaration was
unnecessary since, to their knowledge, their benefits came from
Mr Greer, not Mr Al Fayed. On the other hand, the fact that a
financial relationship existed between them and Mr Al Fayed's
paid lobbyist was pertinent to the departments concerned and should
have been acknowledged.
835. In addition to a failure
to declare relevant interests there were, in the case of Sir
Andrew Bowden and Mr Hamilton, occasions when each
misrepresented his motives for making approaches to Ministers
by referring to reasons other than membership of the lobbying
group. This was misleading conduct on their part.
836. The two Members who
lobbied Ministers on behalf of Skoal Bandits were Mr Hamilton
and Mr Brown, both of whom received commission payments
from Mr Greer for the introduction of UST (the manufacturers of
the product). There is no evidence of any appropriate declaration
and neither Member claims to have made one. The three Ministers
receiving representations confirmed this position although one
(Mrs Currie) said it was no secret that the Members "were
being paid by tobacco lobbyists". Mr Mellor, on the other
hand, said he would not have seen them had he known that they
had such a commercial relationship with UST via Mr Greer.
Allegations of Misconduct
837. Two Members, Mr
Hamilton and Sir Michael Grylls, are the subject of
further allegations, including the acceptance of additional payment
for representing constituents.
838. There is no dispute
about the fact that Mr Hamilton received a commission payment
from Mr Greer for introducing the National Nuclear Corporation
(NNC) to IGA; and a year's consultancy fee from NNC of £7,500.
NNC is a company based in Mr Hamilton's constituency.
839. Mr Hamilton
defends the consultancy on the grounds that the approach came
from NNC; that his support for nuclear power was not affected
by payment; and that the fee represented additional time and effort
put in on the company's behalf. He did not inform the company
of the introduction fee since the two types of payment were not
connected in his mind.
840. In my view this position
is unsustainable. A Member has a duty to pursue the interests
of his constituents and should not take additional payment for
doing so. The fact that his actions in Parliament are not influenced
by such a payment is irrelevant. Moreover, placing oneself under
an apparent obligation to a particular company - especially in
an area as contentious as nuclear power - is bound to create a
conflict of interest in relation to constituents who are opposed
to its objectives. The acceptance by Mr Hamilton of a
substantial fee from Mr Greer for introducing to IGA a company
based in his constituency also causes considerable concern. The
true position is that Mr Hamilton was enriching himself at the
indirect expense of this constituent; he should not have accepted
such a fee.
841. It was also alleged
that in 1989 Mr Hamilton accepted a one year consultancy
worth £10,000 from Mobil Oil (which he duly registered),
in return for which he tabled Parliamentary questions. This allegation
is not borne out by an analysis of Mr Hamilton's Parliamentary
activity during the relevant period and I do not therefore find
842. Sir Michael Grylls
accepted a commission payment from Mr Greer for introducing Charles
Church, a company in his constituency, to IGA. For the reasons
set out in paragraph 840 above I consider this to be unacceptable.
843. Finally, The Guardian
also alleged that Sir Michael engaged in "commission-seeking"
by making his support on an issue concerning Rank Xerox conditional
on that firm's switching from its own public relations adviser
to IGA. This is denied by Sir Michael and the evidence
in support of the charge is inconclusive.
of Non-Registration of Donations to Election Expenses
844. Following the statement
of the Speaker on 14 October 1996, and at the request of the Select
Committee on Standards and Privileges, my inquiry has extended
to allegations, or implied allegations, in the public domain,
even where no formal complaint against the Member concerned has
been made. These allegations were taken from press reports or
other publications and concerned, in particular, payments made
by Mr Greer to the campaign funds of various Members in connection
with the general elections of 1987, 1992 or both. The reports
implied that the Members had committed an irregularity by failing
to register these donations in the Register of Members' Interests.
845. Broadly speaking, the
rules, as they applied at these two elections, required the registration
of donations where, to the Member's knowledge, these exceeded
25 per cent of the Member's declared election expenses.
846. In its Fifth Report
of Session 1996-97 the Select Committee on Standards and Privileges
endorsed my conclusion that for the following Members the position
was completely straightforward and that no contravention of the
rules had taken place:
Mr Robert Atkins,
Mr Alan Beith, Mr Vivian Bendall, Mr John Bowis, Sir Graham Bright,
Sir Anthony Durant, Mrs Gwyneth Dunwoody, Mr Doug Hoyle, Mr David
Mellor, Mr Michael Portillo, Mr David Shaw, Mr Chris Smith, Sir
Malcolm Thornton, Sir Gerard Vaughan and Sir John Wheeler.
847. Four other Members
had been referred to in this context. Of these, the cases of
two - Sir Andrew Bowden and Mr Gerry Malone - have
been discussed earlier in the Report. The remaining two Members
were Mr Nirj Deva and Mr Norman Lamont.
848. From evidence given
to this inquiry it appears that Mr Greer made a donation of £750
towards Mr Deva's election expenses in 1987. Whether there
was also a contribution in 1992 is not known.
849. I asked Mr Deva
for information in respect of the two elections by which I could
determine whether the donations were registrable or not. Mr
Deva took the view that, since he had received no personal
benefit, this was a matter for the local Conservative association.
850. The contribution in
1987 was clearly not registrable because Mr Deva was not
elected: and I have no reason to believe that a contribution
(if any) provided in 1992 would have exceeded 25 per cent of election
851. However, the point
raised by Mr Deva's case is an important one. It can be
argued that, by distancing himself from his party organisation
in regard to election donations he could avoid the obligation
to register, however large the sum involved, since the present
rule would only bite if "to his knowledge" the contribution
exceeded 25 per cent of election expenses.
852. If the rule on the
registration of election donations is to mean anything, it must
be accepted that the onus is on the Member to establish
the size of the gift and the proportion that it represents of
his or her declared election expenses.
853. Mr Lamont's
Conservative association received £2,000 from IGA at the
time of the 1987 election and £5,000 from DHL at the time
of the 1992 election. On the face of it both were registrable.
854. Mr Lamont states
that these funds were paid into a much larger continuous fighting
fund; that campaign expenses were paid out of this fund; and that
there was therefore no way of establishing the precise size of
the contribution towards the expenses which came from IGA or DHL.
855. In my view such an
arrangement defeats the spirit of the registration requirements.
856. I do not consider that
it would be appropriate to criticise Mr Lamont personally
since there is genuine doubt about the interpretation of the rules,
both as they stood in 1987 and 1992, and now. It does, however,
suggest that this aspect of the registration rules needs further
clarification, together with the issue of the definition of the
official election period for the purposes of calculating the level
of declarable expenditure, which is raised by the case of Sir
of the House of 22 May 1974. Back